independent

Monday 21 April 2014

Ryanair bullish over Aer Lingus buyout

Ryanair says it remains confident that the European Commission will approve its €694m acquisition of Aer Lingus despite Brussels having issued a so-called 'statement of objections' to the carrier.

The statement of objections state that the remedies Ryanair proposed to the EU's competition commission to secure approval for the takeover aren't yet sufficient to persuade it to approve a possible takeover. Ryanair confirmed yesterday that it received the statement on Tuesday.

Ryanair launched its latest bid during the summer to acquire its smaller rival. It's the third time it has attempted to buy Aer Lingus since the former state-owned airline floated on the stock market in 2006.

But Ryanair needs clearance from Brussels to go ahead with the takeover. Aer Lingus shareholders would also have to approve the transaction.

Ryanair already owns nearly 30pc of Aer Lingus, while the State owns just over 25pc.

Ryanair has proposed what its chief executive Michael O'Leary has described as a "radical" set of remedies that include encouraging rivals to establish bases in Dublin.

The airline has also offered to offload some existing takeoff and landing slots controlled by Aer Lingus at Heathrow if Brussels gives the green light for the takeover. "This comprehensive remedies-package includes a number of new airline bases in Dublin, new entrant competitors on over 40 routes to/from Dublin, Cork and Shannon, as well as specific competition solutions that guarantee increased price competition on routes to and from Ireland," said Ryanair in a statement yesterday.

It described the statement of objections received from the EU as a "standard procedural step" in intensive phase two EU merger reviews.

"Ryanair expects that the Commission will shortly market-test this transformational remedies-package and remains confident that its offer for Aer Lingus will receive competition clearance following any fair assessment by the Commission," the airline said.

Rivals including British Airways and Virgin are among those airlines that have been approached by Ryanair to sound out interest in commencing or boosting services to Ireland.

Ryanair insisted yesterday that its takeover of Aer Lingus would "secure jobs, growth opportunities and financial benefits for all shareholders in a larger Ireland-based European Union carrier".

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